Twinkie maker Hostess cleared to impose contract on bakers union

Wednesday, 3 Oct 2012 | 5:44 PM ET

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Oct 3 (Reuters) - The bankrupt maker of the Twinkies snack cake, Hostess Brands Inc, received court permission on Wednesday to impose a pay-cutting collective bargaining agreement on thousands of workers in a bakery union, a company spokesman said.

The company has argued that imposing the agreement, which will cut wages by 8 percent and reduce benefits, was the only way for Hostess to avoid liquidating its assets and going out of business.

After the 6,500 members of the Bakery, Confectionary, Tobacco and Grain Millers International Union rejected the pay contract by a wide margin, Hostess asked Judge Robert Drain to impose it as a way of saving the company.

Hostess has now secured cost-cutting deals with steelworkers and its biggest union, the International Brotherhood of Teamsters, which represents 7,000 of the company's 18,000 employees.

Hostess, which operates around 36 bakeries, filed for Chapter 11 bankruptcy protection in January in Manhattan's bankruptcy court.

The case is In re Hostess Brands et al, U.S. Bankruptcy Court for the Southern District of New York, no. 12-22052.